Determinants of farmer participation in direct marketing channels: A case study for cassava in the Oyo State of Nigeria

Abstract

Improving rural farmers’ access to direct agricultural markets is required to ensure sustainable supply of food. Rural farmers in the developing world account for the largest share of food supply including cassava. Globally, cassava (Manihot esculenta Crantz) is recognised as an important source of valuable semi-processed industrial raw materials such as ethanol, high-quality cassava flour and starch. However, there is less empirical research on rural farmers’ participation in direct marketing channels in the cassava sector. This study focused on analysing the determinants of farmer participation in direct marketing channels using the case of the cassava sector in the Oyo State of Nigeria. The Bivariate Tobit model was applied in the empirical analysis, based on a primary dataset generated from 400 rural cassava farmers from the Oyo State of Nigeria. The result showed that, in general, farmers sold a higher percentage of their cassava output to processors. The Bivariate Tobit results showed that human capital, physical capital, social capital, and market conditions had significant effects on farmers’ decisions on whether to sell their cassava output directly to processors or middlemen. On the contrary, natural and financial capitals did not significantly affect farmers’ marketing channel decision. The study recommends that policy instruments should target improving road networks in rural areas, enhancing farmers’ access to market information, and increasing membership of farmer association to ensure an active participation of farmers in the direct marketing channels.

Keywords

• Bivariate Tobit
• market participation
• Manihot esculenta Crantz
• 5-capital framework
• rural development
• econometrics
• agricultural market